The New York-based parent company of HomeAdvisor has announced an offer to acquire Indianapolis-based Angie’s List Inc. (Nasdaq: ANGI). InterActiveCorp (Nasdaq: IACI) Chief Executive Officer Joey Levin says he met last month with Angie’s List CEO Scott Durchslag and Chief Financial Officer Thomas Fox to discuss a potential deal. In a statement, Angie’s List says it will "carefully review and evaluate IAC’s proposal" and its board of directors will then act in the best interest of its shareholders. In a letter to the Angie’s List board issued Wednesday afternoon, Levin said he was "disappointed to hear that the Board is not interested in further engaging with us regarding a strategic transaction." IAC says its offer is $8.75 per share of Angie’s List common stock.
Angie’s List says its has confirmed receipt of the unsolicited proposal, which also indicates IAC’s "willingness to consider a combination of Angie’s List with IAC’s HomeAdvisor business through a tax-free stock-for-stock exchange."
HomeAdvisor, which used to be known as ServiceMagic, is a Colorado-based competitor of Angie’s List. The site bills itself as "always free" and says it offers reviews of more than 2 Million home improvement professionals and is used by over 30 million homeowners. Angie’s List says more than 3 million households check its ratings and reviews of more than 720 services. Angie’s List says more than 100 million unique visitors come to Angie’s List each year, 85 percent of which are nonmembers.
IAC also owns digital properties such as Match.com, OkCupid.com, the Tinder app, The Princeton Review, Ask.com, Dictionary.com, Vimeo, The Daily Beast and CollegeHumor.
This morning, Angie’s List announced it was launching a feature called "LeadFeed," which is designed to link non-Angie’s List members to service providers. The system will pop up a message on the site asking visitors to detail their projects. That information will be sent to the company’s network of providers, who then can connect with the potential customers. Durchslag says "we are unlocking a powerful new source of business for highly rated service providers, while introducing millions of non-members to the strength and breadth of the Angie’s List network."
In Levin’s letter to the Angie’s List board of directors, he said "we continue to believe a transaction involving our companies has a compelling strategic rationale, and we are confident we are well-positioned to swiftly consummate a transaction that will be in the best interests of Angie’s List stockholders." He said the company would also be open to discussing a combination of Angie’s List with HomeAdvisor, which he said could be structured "as a tax-free exchange for Angie’s List stockholders and would allow Angie’s List stockholders to participate in the upside resulting from the opportunities available to the combined company." Levin said the combined platform would have "unparalleled consumer reach and an incomparable network of paid service professionals."
Levin continued, calling the transaction IAC’s "highest priority." He said IAC preferred to discuss the acquisition in a confidential and cooperative manner, but "we have been unable to develop any meaningful dialogue with you for many months now and were disappointed by your unwillingness to continue discussions with us following our meeting."